Stocks catapulted higher out of the gate Tuesday and stayed that way through the close as a weaker-than-expected inflation update ramped up expectations the Federal Reserve is done hiking interest rates.
Ahead of the opening bell, data from the Bureau of Labor Statistics showed that the October Consumer Price Index (CPI) was flat on a month-over-month basis and up 3.2% year-over-year.
Core CPI, which excludes volatile food and energy prices, was up 0.2% compared to August and 4.0% vs October 2022, the latter of which represented the smallest annual increase since September 2021.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The October CPI report "should likely keep the Fed from raising interest rates at next month's meeting," says Jeffrey Roach, chief economist at LPL Financial. However, the economist also believes that despite the deceleration in price growth, "the Fed will likely continue to speak hawkishly and will keep warning investors not to be complacent about [its] resolve to get inflation down to the long-run 2% target."
Home Depot pops after earnings
Today's rally was broad-based, with all 11 S&P 500 sectors closing higher. Real estate led the charge with its 5.4% gain, though consumer discretionary stocks (+3.4%) were near the top of the pack thanks to a positive reaction to Home Depot (HD) earnings.
The blue chip stock surged 5.4% today after the home improvement retailer reported higher-than-expected third-quarter earnings of $3.81 per share on revenue of $37.7 billion. Home Depot also disclosed a same-store-sales decline (-3.1%) that was narrower than Wall Street projected.
The company was cautious in its guidance, however, amid what CEO Ted Decker calls "a period of moderation for home improvement spend."
Jon Bostock, CEO of home improvement products company Leaf Home, expects this period of moderation to continue into 2024. Consumers will still spend disposable income on home projects, just at a slower pace than we've seen in recent years, the executive adds, which should result in a low single-digit growth forecast for Home Depot's upcoming fiscal year.
Snap sizzles on new Amazon partnership
Snap (SNAP) was another big mover on Tuesday, with the communication services stock soaring 7.5%. Boosting shares was news the company has inked a deal with Amazon.com (AMZN, +2.3%) that will allow Snapchat users to buy products directly from the e-commerce giant via ads on the social media platform.
As for the major indexes, the Dow Jones Industrial Average surged 1.4% to 34,827, the S&P 500 gained 1.9% to 4,495, and the Nasdaq Composite jumped 2.4% to 14,094.
Related content
- Walmart Expands Health Insurance Reach in Florida
- Kiplinger's Earnings Calendar for This Week (Nov. 13-17)
- What Are the Capital Gains Tax Rates for 2023 vs. 2024?
-
USPS Is Raising Prices for Holiday Shipping: Dates and Increases You Need to KnowWhat the USPS's $16 price hike means for your wallet and your small business.
-
July CPI Report Ignites a Risk-On Rally: Stock Market TodayMarket participants price out worst-case scenarios for tariffs and inflation and will now turn their attention to employment and growth.
-
July CPI Report Ignites a Risk-On Rally: Stock Market Today
Market participants price out worst-case scenarios for tariffs and inflation and will now turn their attention to employment and growth.
-
Stocks Slip Ahead of July CPI Report: Stock Market TodayThe latest inflation updates roll in this week and Wall Street is watching to see how much of an impact tariffs are having on cost pressures.
-
Nasdaq Ends the Week at a New High: Stock Market TodayThe S&P 500 came within a hair of a new high, while the Dow Jones Industrial Average still has yet to hit a fresh peak in 2025.
-
Stocks Swing Lower as Eli Lilly, Fortinet Spiral: Stock Market TodayThe main indexes finished well off their session highs after a disappointing batch of corporate earnings reports.
-
What Tariffs Mean for Your Sector ExposureNew, higher and changing tariffs will ripple through the economy and into share prices for many quarters to come.
-
Stocks Rally on Apple Strength: Stock Market TodayThe iPhone maker will boost its U.S. investment by $100 billion, which sent the Dow Jones stock soaring.
-
Rally Pauses for Hot Earnings, Cool Data: Stock Market TodayMarkets were mostly mixed Tuesday after decisive moves Friday and Monday.
-
Dow Rises 585 Points on Rate Cut Hope: Stock Market TodayStocks moved more than 1% again Monday, this time to the upside following the Jobs Friday sell-off.
